IRA Contribution Deduction--No W-2 Earned Income

TAXquest
TAXquest Member Posts: 3 Newcomer
edited February 13 in Retirement Income

I have only SocSec and 1099-R(pension) income yet the software allows me to take an IRA contribution deduction

I thought the deduction was allowed only on W-2/Earned Income

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  • JMSSGV
    JMSSGV Member Posts: 152

    Do you have any self-employment income (1099-NEC or 1099-K for example) or other income that you identified as earned income?

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  • TAXquest
    TAXquest Member Posts: 3 Newcomer

    I did not have any earned income, but my wife did have W-2 Income…. $15,951.

    Her IRA contribution is $8000; it's allowing me to contribute $7,900. (when I tried $8k, I was told I had $49 of excess traditional IRA contributions.)

    Apparently we can "share" her W-2 income, since filing jointly. I had thought IRA contributions/limitations were tied to individual's earnings.

    Just don't want to file this incorrectly.

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  • JMSSGV
    JMSSGV Member Posts: 152

    You might want to take a look at the paragraph under "Spousal IRAs" here: https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits

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